Switzerland banks are mandated to adhere to local FINMA regulations instead of ESMA

It’s been a little over two months since the new European regulatory framework got implemented across the continent. The industry has been preparing for the market shift for over a year, and despite this, some surprises persist.

While constantly on the lookout for new angles on covering the new regulatory environment in the EU, Finance Magnates reached out to a seasoned industry veteran for some comments. The CEO of Swiss bank Swissquote, Mark Burki, was keen to provide some details on the company’s operations in recent years.

Swissquote’s Internaxx Acquisition

We started with a recent acquisition which the company announced during the summer months. Swissquote’s move was seen as a hedge against Brexit at the time, but the CEO of the Swiss bank had more to share.

“The acquisition will give Swissquote an unrestricted access to the European market. This is important to us, especially since Brexit draws closer. The acquisition is primarily of strategic importance for Swissquote, but also to take advantage of growth opportunities, especially in the expatriate business,” Burki elaborated.

He also explained that with the deal, Swissquote acquired a number of international and expat clients. The existing investment opportunities which the customers of Internaxx have had access to will naturally be expanded under the ownership of the Swiss bank. One such direction is cryptocurrency investments.

The company is at present integrating the Luxembourg brokerage’s offering with the traditional markets and products available to Swissquote Bank’s clients.

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Switzerland is Open for Business

A little-known fact for retail traders across Europe is the open access to the Swiss financial intermediaries market. For those European investors who are still missing trading with higher than 30:1 leverage, Swiss banks offer a safe haven.

Little-discussed among the trading community, the offerings of the Swiss banks are competitive. The restrictions on part of European regulators to advertising, however, are limiting client access to the services.

Commenting on the matter, Burki explained: “Swissquote Bank adjusts its trading policy based on Swiss rules which are defined by the FINMA and is therefore not concerned by the new ESMA framework.”

“EU clients can technically apply for a Forex Bank account in Switzerland and can trade under leverage conditions defined by the FINMA and within Swissquote’s leverage limit of 1:100.

This being said, Swissquote Bank does not advertise its services to EU residents,” the CEO of Swissquote explained.

At present, the company owns an FCA-regulated brokerage entity, which is based in London. The subsidiary allows the firm to passport its forex services in the EU and is fully compliant with the new ESMA regulations.

Swissquote is the lanyard & attendee bag sponsor at the Finance Magnates London Summit 2018.